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Posts Tagged ‘IT services

Startups have short launchpads and high expectations. In order to lighten the yoke, many startup founders turn to outsourcing, letting a third party provider handle some aspects of the business.

If you do it the “right way”, you can build a very successful company that way. The right way is *not* to think of your remote team members as outsourcing, but as a key part of your team.

In considering outsourcing as a potential option, you must first weigh the positive and negative impacts. Outsourcing frees up leadership to focus on the parts of the business that differentiate you from the competition, while staying assured that the basic parts are all still operating properly.

Outsourcing is a great option for some startups, but it can be confusing. There’re 5 questions you should answer to decide if outsourcing is the solution:

What is outsourcing?
Outsourcing is the farming out of a business process or service to a third-party provider. Outsourcing frees up some mental space for founders and can sometimes even save money.

What exactly are you outsourcing?
There are certain skillsets which are difficult to bring in-house. It is essential to understand what you will and what you will not be outsourcing, to understand what should rest totally in your control and what can be handled by someone else.

Is the vendor startup-oriented?
The choice of which company to outsource to is important. Vendor should be very active in implanting best practices from the software industry into the startups they work with.

Are you a good client?
Good clients should know what they want, otherwise they’re effectively wasting their own money. A highly collaborative attitude is helpful too. Clients should want to understand the development process just as developers should get a handle in the product’s business objectives. A mismatch between end-project and expectations is often the result of poor communication.

Does the reputation of the vendor matter to you?
People often rely on reputation to make outsourcing decisions. Ask for reviews and recommendations of providers to try and determine which one best fits your needs.

Outsourcing is one of the earliest crucial decisions that startups have to make after inception. Often, the decision lies not in whether to outsource, but who to outsource to and how.

Do you outsource? Please share your experience in comments bellow.

 

Kristina Kozlova

Marketing Manager

 

altabel

Altabel Group

Professional Software Development

E-mail: contact@altabel.com
www.altabel.com

Fear of surrendering control is probably the main factor holding many IT directors back from realizing the benefits of outsourcing IT services. But if you can find an IT services supplier who will work with you in a genuine partnership, understanding the specific needs of your business, it soon becomes clear that this fear is misplaced. It is perfectly possible to retain your strategic power while outsourcing the fundamental and mundane elements of your IT service and support. By opening the door to outsourcing some niche services or even your entire application or database management infrastructure, you can generate a host of business benefits.

The top 10 benefits of outsourcing

  1. Reduced service and support costs within a managed and predictable budget
  2. Better quality of service, fewer IT failures and less downtime thanks to well-defined service level agreements
  3. Access to the latest applications without high up-front license costs
  4. Access to accredited engineers, skills and technical expertise without having to train your own staff
  5. Reduced risk of employees leaving and taking their knowledge with them
  6. Round-the-clock access to a help desk primed to resolve problems remotely and rapidly
  7. Compliance with the latest regulations
  8. Guaranteed data security at remote, hosted data centers
  9. Real accountability via contracted commitments from a third party supplier partner that wants to keep your business rather than reliance on an in-house group that is hard to pin down
  10. Remove high IT staff costs from your balance sheet and shift to an opex budget

For some time, there have been signs that IT directors in smaller enterprises are increasingly receptive to these benefits and are even embracing them with greater agility than their global counterparts. A survey from Computer Economics suggested that 27% of businesses now outsource applications management, while 21% outsource database management.

According to Information Week, as this level of outsourcing gains credibility the benefits quickly accumulate in terms of greater flexibility (particularly for companies that are growing rapidly); access to cost-effective expertise, techniques and programs; access to third-party resources such as the help desk, which liberates IT staff to focus on more productive business-focused activities; and the wider savings achieved by not having to invest in infrastructure and licenses.

Take email services as one example: Gartner estimates that outsourcing just this one application could save businesses with fewer than 300 employees a significant amount because an outsourcing partner has the dedicated infrastructure to manage it at a much lower cost.

Five reasons to outsource

Here are five good reasons why you should think about outsourcing your IT services:

1.       You could save significant staff costs.
Not just on the recruitment and hiring front.  Skilled people with strong application-based credentials don’t come cheap and have long-term costs. Why spend time and money training somebody to support a core business application, only to see them poached by another employer and taking their expensively-acquired skills with them? Or send them to costly training to keep their skills current? And why not liberate your in-house IT staff to focus on projects that add value to the business rather than spending their precious time on firefighting duty?

2.       An outsourced call center/help desk frees your resources.

Providing round-the-clock support for your users in-house is expensive. Depending on the size of your business, you might need a dedicated facility that is operated by key IT support staff and is a significant cost center in terms of facilities management overheads. Even in a smaller IT operation, somebody—it might even be you—has to be on call outside office hours to provide IT support for an increasingly mobile workforce. Thanks to greater economies of scale, a dynamic IT services partner should provide a superior help desk at a greatly reduced cost.

3.       You can save money all around – with the right outsourcing strategy and partner.

A good IT services partner will work with you to identify the pressure points that make sense for you to outsource. These can vary tremendously from one business to another.  Toolbox.com points out that cost savings vary with the number of employees who need support and to what degree, the number of devices involved, the types of applications that you use, the ratio of employees using office space to remote workers, and even your geographic location when it comes to the price of on-site support. These are complex calculations that deserve patient analysis.

4.       Your business will be more flexible in its use and consumption of IT services.

Infrastructure is expensive. Why invest in servers, complex networks and other hardware just to deliver vital but everyday applications to your users when you can have those applications managed and distributed as a service direct to the desktop without the expense of hardware maintenance? Because your applications are being managed and hosted by a third party, they can be scaled up or down to meet fluctuating demand, and your costs will be more tightly controlled as a result.

5.       Peace of mind.

Why let worries about more complex issues such as data security or disaster recovery keep you awake at night when they can be managed and supported by a third party who has all the necessary expertise and infrastructure to meet your security and business continuity requirements? Yes, they are important, but by choosing the right partner to provide relevant support services, you are prioritizing them rather than allowing them to become distractions that need constant attention from your in-house IT team.

Getting Started

Negotiation is the key to getting your relationship with your IT services supplier off to the best start and making sure you realize the business benefits that you expect. And it starts long before the contract is signed. It should be more profitable if you decide what you want from your contract before you choose your supplier.

Partnership Approach

Select an IT service partner who demonstrates they understand your business and clearly articulates the value they can bring to your operations. By combining and matching your goals with an IT service partner who has the vision to match them and deliver the latest service desk technologies to provide you with complete service performance visibility, including measurable indications of performance quality, you’ll soon become part of the rising tide of SMEs that are living proof of the benefits of outsourcing.

And remember,

  • Outsourcing IT services does not mean all or nothing.
  • You can deliver genuine benefits to your business by outsourcing IT services if you negotiate service levels that are customized to your company.
  • Fear of surrendering control is the main factor holding many IT directors back from outsourcing IT services—but you can keep control if you select the right partner.

Feel free to share your thoughts.

Polina Mikhan

Polina Mikhan
Polina.Mikhan@altabel.com 
Skype ID: poly1020
Business Development Manager (LI page)
Altabel Group – Professional Software Development

Despite the fact that Sweden has not always been a welfare state, now it is quite a stable and prosperous country with a good standard of living, a country, which is constantly developing. Let’s see how this development influences IT market, for example.

 Sweden is making large annual investments in education and research and it is well-known for  its  good  education  level.  Development  has also come into information  and  communications  technology,  where  Sweden  is  one  of  the leading  countries  in  the  world.   However,  the current  problem  in  labor  market  is  that  there  is  not  enough  workforce in service companies, information technology, school system and health care sectors. Despite high technology level, Swedish people love their nature and concern for nature is playing a big role in future decisions. That is why Sweden is also putting a lot of effort to improve the environmental technology, which will be one of the most important industries in the future.

  • Swedish IT sector

is  strongly  bound  to the  development  of  society.  Sweden  has   many  successful  companies  in  IT and  telecommunication  sector  and  the  companies  have  a  great  capacity  of innovation. However from 34 000 of companies in Swedish ICT sector are micro enterprises  with  under  100  000€  turnover. 

IT sector  can be divided into four sub-sectors: Software and IT services,  Tele-and  data  communications,  manufacture  of  hardware  and  retail and services of computer . IT sector in Sweden is mostly dominated by the software market. Most of them have specialized in systems  software  for  communications,  business  systems  and  applications software for telecommunications.

Software products and IT services earn 32% of the turnover in IT-sector. The growth in the software products and IT services has been  very  strong.  The  turnover  has  increased  32.5%  between  the  year  2005 and 2009. The second in the IT-sector is Telecom and datacom services with 27.3%, manufacture of hardware comes next with 24.5% and the fourth largest is retail and servicing the hardware.

Swedish IT-  sector employs about 3.9% of the total Swedish work force. Despite  the economic recession, Swedish IT sector has stayed healthy. The main reason of IT sectors welfare is that the companies in Sweden believe that the  IT-services  and  IT-products  are  essential  for  survival  in  the  future.  IT solutions are the key factor when it comes to make the business more effective and  environmentally  friendly.  That  is  why  the  companies  are  putting  effort  to develop  the  IT  solutions. Especially environmentally friendly  solutions  are  the focus in the future in Sweden. Almost every  company  uses  computers (97%) and 96% of them have an access to Internet. Internet has increased its significance in  doing  business.

  • Mobile services

Are an  increasing  trend  in  business  life.  Already 60% of all companies are using mobile Internet connections in 2010. Swedish  people  are  interested  in  a  product  which  can  increase  their customers’  competitiveness and  increase  the  company’s  value  for  its  owners, customers and another interest groups.

Swedish people are open-minded to test new services and products. The good thing is that they might accept the new product or service very easily, but the challenge is to keep the product or service updated. People in Sweden are well educated  and  they  are  looking  all  the  time  new  innovative  ways  to  run  the business.

  • Conclusions:

– The majority of companies cost  are spent on software research and development. So they are willing to invest on software if they can see the product useful for the business. The most favorable applications  are  such  as  ERP,  CRM,  financial  management  and  information software, on which the companies are spending about 60% of their founds.

-The environmental study concentrated more on macro indicators which means background  forces  behind  the  company’s  activities  such  as  social, technological,  economical  and  political  environment.

-Sweden’s lifestyle  and  culture  form  an  ideal  market place, because they are open-minded to test new services and products. The people  are  well  educated  and  they  are  all  the  time  searching  for new  innovation solutions  to  run  their  business.  The positive point is that the customers are willing to  accept  new  innovation,  but  they  can  also  replace  it  when  they  can  find  a better  solution.  So the  major  challenge  is  to  keep  the  product development up.

– Sweden  is  one  of  the  leading  countries  in the development  of  information  and  communications  technology.  Almost every company has computer and Internet access and already 60% of all companies had  a  mobile  Internet  connection  in  2010.  So, mobile  phones  are  becoming more and more important on daily business.

– Swedish  people  are putting  a  lot  of  effort  to  improve  the  environmental  technology,  so  this  “eco” thinking has a strong position in Swedish culture.

– Sweden is making a lot effort to software research and development and they want to be the top leaders in the software markets by 2020.

-The global software leaders Microsoft, International Business Machines (IBM), Oracle and SAP are also leading the Swedish software markets, but they are controlling particular areas of software branch which is why the local companies have also  acquired  a  good  position  on  the  market.

-Swedish software and IT services have a larger number of companies than the other sub-sectors,  but  most  of  them  are  small  companies.

– IT outsourcing has been a steadily growing part of the Swedish IT market, which is considered to be the largest market within the Nordic region and the 3rd largest in Europe. Every year more Swedish companies decide to outsource. The majority of Swedish companies decide to outsource due to conditions such as a shortage of IT domestic skills and high costs of performing in-house solutions, or a need to re-focus on core competencies. In order to avoid multiplied risks associated to outsourcing.

And what tendencies in Swedish IT market would you like to point out? It is interesting to know your opinion!

 

Kate Kviatkovskaya

Kate Kviatkovskaya

Business Development Manager

E-mail: Kate.Kviatkovskaya@altabel.com
Skype: kate.kviatkovskaya
LI Profile: Kate Kviatkovskaya

 

altabel

Altabel Group

Professional Software Development

E-mail: contact@altabel.com
www.altabel.com

The practice of renting virtualised pools of servers and storage over the net is known as infrastructure as a service (IaaS), and is the most popular class of cloud service available today.

But most businesses are only making limited use of IaaS, with the majority restricting their use to spinning up application development and test environments or to rapidly provisioning extra server capacity during periods of heavy demand.

The reasons for this limited adoption are many: concerns about security of data and systems controlled by a third party, worries over the reliability of systems run by a cloud provider and served over the internet, and the premium paid for getting a vendor to provide infrastructure over running it in-house.

But where demand for IT services is uneven, fluctuating between high and low-demand, or where a business needs infrastructure to test applications for a short period or to try out a new endeavour, it can be more cost effective and far quicker to rent infrastructure from a cloud provider than attempting to build it in-house. There are even instances of companies like Netflix, which runs its entire IT operation on Amazon Web Services’ infrastructure.

AWS main IaaS offerings are EC2, which provides compute on demand and S3, which provides storage on demand. EC2 gives companies access to virtual machines or instances running an OS and applications of their choice over the internet, with these instances being configurable and controllable via web service APIs. Alongside and on top of these EC2 and S3 AWS provides a range of cloud offerings related to networking, load balancing, databases, data warehousing and big data analysis, as well as a range of management tools.

At the AWS Enterprise Summit in London on Tuesday businesses broadly outlined the ways they are using AWS today and lessons that can be learned from their experience.

Application development and testing
Developers and testers commonly use a self-service approach to draw computing resources from the likes of AWS EC2, S3 and Amazon’s block level storage service EBS. Typically this will be carried out via a self service portal, such as AWS’ own CloudFormation, or via some other form of API call.

Businesses often create self-service enterprise portals that automatically restrict how much computing resource should be provisioned and for how long based on governance and workflow requirements, and that tag the resources that are appropriate for different teams.

Businesses are using EC2 to enable standard build developer/test workstations, add integrated project management and issue tracking, to run popular source control systems and to drive build servers and continuous integration, according to Yuri Misnik, head of solutions architecture at AWS.

On the testing side EC2 instances are being used to allow unit and regression tests to be scaled up and run in parallel in a fraction of the time of doing it in-house, for A/B scenario testing to be run on replica stacks and for the creation of sandboxes for security testing, said Misnik. For testing how applications perform under load, he said, customers sometimes use spot instances – a pricing model where customers bid for time on unused EC2 instances – as a cost effective way of stressing applications.

AWS has a number of pricing models for renting infrastructure, based on how customers want to use it. For instance on-demand instances let customers pay for compute capacity by the hour with no long term commitments, while reserved instances require a one-time up front payment in return for a significant discount to the hourly rate. Customers can save a lot of money by ensuring the pricing model they use is best suited to their need, said Misnik, citing a customer that saved 45 percent cost by transitioning to reserved instances. AWS provides a tool Trusted Advisor, which makes recommendations on how customers can save money and improve performance or security.

Entertainment conglomerate Lionsgate, has used EC2 to develop and test SAP apps, reducing deployment time from weeks to days, as has Galata Chemicals, which reduced the cost of running development and testing operations by 70 percent by moving to EC2.

Building and running new application
The UK broadcaster Channel 4 launched its first live application on AWS in 2008 and today runs all of its new web apps on the infrastructure.

Describing the benefits of running apps on AWS, Bob Harris, chief technology officer with Channel 4, name-checked agility, scalability and resilience.

“We get servers up and running for teams in minutes, if it’s urgent, or hours,” he said.

The broadcaster sees “a huge increase in productivity” among teams building apps running on AWS, said Harris, because of the development team’s ability to deploy or destroy virtual servers and apps as and when they need to.

That freedom to spin up new instances has a downside, however.

“One of the things it lets you do is be inefficient far more efficiently,” said Harris.

“People tend to start instances, maybe they start more than they need or too big. So we’ve have a constant battle over the past couple of years making sure that we’re keeping our house in order behind us.”

Tools like Trusted Advisor are designed to help keep on top of this problem by flagging up the number of instances being used.

For a broadcaster that has to deal with spikes in traffic to its web sites and apps after popular TV programmes are broadcast, and doesn’t want to have to buy excess capacity for one time peaks in demand, the scalability of AWS was a good fit, said Harris.

“The peaky workloads are the important ones. In the past you had to explain to the marketing manager those 404s were a sign of success because it showed how much traffic came to your website. Today I can’t remember the last time that happened on a Channel 4 website.”

Harris estimates that the total cost of ownership for running these services on AWS is more than five times lower than running it off in-house infrastructure.

He stressed the need to build services that worked well with horizontal scaling across different EC2 instances as demand increased. Licensing of back-end software is another consideration, with Harris saying that there are still difficulties with software vendors being tied to a per machine or per CPU socket licensing model, which is obviously a poor fit for EC2 where software can be running on a varying number of virtual and physical machines based on demand.

“My personal view is that a significant number of proprietary models are simply not cloud-friendly because they don’t allow us to take advantage of that flexibility. Cloud plus open source is really the place you need to be if you want high scalability,” he said.

Proprietary software vendors are beginning to make concessions for running their software in the cloud, with Microsoft, SAP, Oracle and IBM offering licence mobility deals for their major software packages to AWS customers that are a better fit for cloud computing’s scalable pay per use model.

Augment on-premise systems and run hybrid apps
Hybrid apps are those that rely on a mixture of back-end services running on both in-house and AWS infrastructure.

AWS provides multiple features to help companies building hybrid apps integrate their datacentres with AWS infrastructure in a secure fashion, such as AWS Direct Connect and Virtual Private Cloud.

Access controls similar to those within in-house datacentres can be set on AWS infrastructure using its Identity and Access Management tools while AWS CloudHSM (hardware security modules) are ultra secure key management appliances which can be used by customers who have to follow stringent data protection regulations so they are able to move data onto AWS infrastructure.

Another approach taken by businesses is to offload certain systems to AWS: Nokia runs analysis on data stored on Amazon’s Redshift data warehousing platform, allowing it to reduce cost by up to 50 percent and run queries up to twice as fast compared to its previous data warehouse.

Channel 4 is using AWS Elastic Map Reduce (EMR) service, the AWS-hosted Hadoop framework running on EC2 and S3, to analyse web logs from its sites going back a number of years and hone ad-targeting and programme recommendations.

Channel 4’s Harris said that EMR provides a way for the broadcaster to experiment without the commitment of an up front investment, an important consideration when the outcome of big data analysis is uncertain.

“It’s about the cost of exit – how much money have I sunk if I’ve to walk away. In big data we’re all trying to work out ‘What’s the real value of a better ad target?’, it’s a hard analysis to do. Imagine if I wanted to ramp my physical platform by ten or more times, we’re talking tens of millions of pounds. By the time I’ve also hired the half a dozen people to run this thing this is seriously expensive.”

AWS’ Misnik also said some businesses are using AWS infrastructure as a cloud-based disaster recovery site, running anything up to hot standby environments with rapid failover.

Migrating existing apps to the cloud
Migrating apps running on in-house infrastructure to AWS is less common, as it presents a number of challenges.

Matthew Graham-Hyde, CIO of the media conglomerate Kantar Group, said getting a migrated app to work requires both re-engineering the app and working out the right mix of cloud infrastructure it needs to sit upon.

“It’s a very different working model when you take an application and re-engineer it for the cloud,” he said, for instance so it is able to scale across available instances based on demand and exploit the distributed nature of the cloud architecture to become more resilient to failure.

“You have to have everyone in the room – your infrastructure architects, sysadmins, business analysts, developers, consulting partners – and you’re ripping up installation after installation as you re-engineer this application to get the true benefits of being a cloud application. It’s a very iterative model.”

Kantar has migrated a number of apps to AWS, including a third party data visualisation tool whose running costs have dropped by 50 percent since the move.

AWS recommends migrating apps that are under-utilised, that have an immediate need to scale or that simply are the easiest to move. Examples of apps and systems that should prove more straightforward to migrate are, AWS claims: web apps, batch processing systems, content management systems, digital asset management systems, log processing systems, collaborative tools and big data analytics platforms.

Another company that claims to have benefited from shifting existing systems to AWS is the pharmaceutical firm Bristol-Myers Squibb, which migrated its clinical trial simulation platform, with the result that simulation times have been reduced from 60 hours down to 1.3 hours and reduced costs by 60 percent.

Everything in the cloud
Video streaming company Netflix is one of the few firms to have dispensed of its in-house datacentres entirely in favour running its entire infrastructure on top of AWS services.

The spiky nature of customer traffic means Netflix is a good match for the scalability offered by EC2. Netflix uses thousands of EC2 instances in multiple regions and across the various AWS availability zones to support more than 33 million customers worldwide.

Not having to run IT infrastructure has freed up the IT team at Netflix to devote time to improving the performance or features of the company’s IT services. But Netflix is also an example of the amount of work needed to go “all-in” on cloud – the company has devoted a lot of time to making AWS work as a platform for its business (going as far as to develop the Chaos Monkey software that breaks parts of production systems to test overall resiliency), the latency inside a distributed architecture and limitations on compute storage and networking that come with sharing a server’s resources with other customers.
 

Kristina Kozlova

Marketing Manager

 

altabel

Altabel Group

Professional Software Development

E-mail: contact@altabel.com
www.altabel.com

The German IT market is the largest in Europe and number 4 in the world (behind US, China and Japan). According to market research it is forecast to grow at a CAGR of 4% over 2011-2015. The addressable domestic market for IT products and services is projected by BMI to reach US$60.8bn in 2011 and US$71.8bn by 2015.

German IT services spending is forecast to reach US$24.8bn in 2011 and to rise to US$29.9bn in 2015. Demand drivers will include emerging technologies, such as projects to enable SaaS use, and reducing costs through data centre infrastructure outsourcing.

Despite the fact that German market is relatively mature, there is plenty of potential for ERP implementations in industries such as consumer products, telecommunications, energy, engineering transport and retail. ERP demand drivers include boosting the efficiency of global supply chains and logistics processes. Meantime, business intelligence will continue to be one of the fastest-growing product areas in 2011.

Industry Developments Government funding for technology policy measures amounted to EUR2.3bn. The German has announced it will provide an additional EUR12bn for education as well as research and development (R&D). Among other priorities, the government is determined to encourage German companies to innovate, to cope in the economic upturn.

In 2011, software vendors in the German market will focus increasingly on cloud computing. In October 2010, Microsoft launched a cloud computing alliance with German-based Datapoint, a provider of ICT services to the public sector. Meanwhile, SAP launched a new version of its hosted CRM software product SalesOnDemand, after the first version, released five years before, had failed to really take off.
One distinctive feature of the market is the influence of medium-sized companies. The German software market is competitive, with smaller companies having a niche alongside major players such as German software giant SAP, Oracle and Microsoft. Around 300 software providers compete in the enterprise resource planning (ERP) market for the small and medium-sized enterprise (SME) segment alone. Other major players across all segments include Sage, SoftM and Infor Global Solutions.
As far as German market characteristics are concerned, the German market differs from other European markets: German market is peripheral. If you want to sell to France, you have to be in Paris – and you have 90% of the market nearby. If you sell to the UK, you have to be in London – and you have 90% of the market nearby. If you sell to Germany you have to be everywhere. There is no single town dominating everything – particularly not Berlin. There are core areas for some market sectors. Frankfurt is such a core area for the finance market, Berlin for the governmental business and Munich for the IT companies. But Hamburg, Düsseldorf, Cologne, Stuttgart, Nuremberg are also important places for the business. And we shouldn`t forget about Bremen, Hannover, Mannheim, Karlsruhe, Leipzig .

German IT market seems to be rather perspective for market players. But we shouldn`t forget that in order to be a successful market player we should follow “the receiving party rules”.

Kind regards,
Anna Kozik – Business Development Manager (LI page)
Anna.Kozik@altabel.com
Altabel Group – Professional Software Development

The debate on the success of outsourcing as an industry seems to last endlessly. Over the years outsourcing contracts underwent a lot of changes – as the result we now see more multi-sourcing engagements and smaller focused contracts. In fact outsourcing contracts shrank in length or value per contract, but the relationship with the client has endured. Indeed, it’s relations, not size that matters. So, recently the issue of a choice of a right vendor for an outsourcing contract has become even sharper and vital for a larger number of companies in IT industry.

Many organizations that want to outsource IT services are intimidated by the task of determining which location in general and vendor in particular would best suit their requirements. Many researches in the field have been made. If in the early days of outsourcing price level was the weightiest criterion, now determination of an outsourcing partner and their geo-location is based on a whole system of criteria including not solely cost competitiveness based ones but key statistics on resources and skills level, country’s business and economic environment. Among them you may see English (French, German, etc) language skills, educational system quality, cultural compatibility, political and economic environment, global and legal maturity, and data and intellectual property security and privacy.

Historically such low-cost locations as India for instance were very popular offshore outsourcing destinations, still recently with the maturation of IT domain and with recent wage inflation and educational challenges these locations have receded their position as outsourcers now expect more “added value” to their projects and business. In this respect more attention is paid to Eastern European region, especially by Western and Northern European companies. Germany, Switzerland and Austria along with the Nordics in particular perceive Eastern Europe as a favored nearshore destination. Eastern Europe ranks high in terms of efficiency of technical education, work ethics and cultural sensitivity adding to the region’s geo-attractiveness as a base for outsourced activity.

Many respectable researchers think in the next ten years it is likely that Eastern Europe will move out from being an ‘emerging destination’ to a ‘key destination’ for outsourced activity: even though facing continued cost pressure from Indian market and despite being largely ‘overlooked’ by US based outsourcing providers, it is expected to proceed receiving its share of traditional high end software engineering and other IT services, from Western and Northern Europe. Many who experienced outsourcing there are characterizing Eastern Europe (Lithuania, Russia, Belarus, Ukraine, etc) as [a good place to find low cost, technically superb coders,.. generally hard workers, honest in answers to any your questions and strategically thinking].

Anyway, all these ratings of outsourcing locations are just generalization – anywhere you may find good and worse executors. As Gartner tips: “Don’t just seek the leaders – determine which vendors are the right fit for your organization”.

Well, perhaps very generally it would be a bad idea to hire designers from South East Asia if you expect a Western looking result :), still efficiency of an IT service provider should be checked in each particular case. There are a couple of advises helping to choose a good provider:

– Choose companies who have good feedback, ratings and recommendations. If a company follows market trends, makes marketing and technical researches, has good recommendations, especially from the companies from your geo-region, these all mark quite a solid level of credibility.

– Be careful about generic responses. This mostly concerns a stage when particular project details/requirements are already discussed. The tip considers both parties actually 🙂

– Start cooperation with a relatively small test/pilot project to evaluate provider’s competences. Altabel Group’s experience shows it’s natural for our clients to develop a pilot project with us to confirm our competences and then organically move on to Dedicated Development Team model for further cooperation.

– Try to meet your partners personally at initial stages of cooperation. Arrange short trips to visit a provider and especially meet your team members face to face.

– Think “potentially”. Keep contact information of those companies whose responses you liked for future references even if they do not fit your current project requirements.

And what are tips from personal experience? When does outsourcing have the best chances to succeed or fail? Do you have any preference in terms of a region to outsource from?

You are welcome to share your opinions here.

Kind regards,
Helen Boyarchuk – Business Development Manager (LI page)
Helen.Boyarchuk@altabel.com | Skype ID: helen_boyarchuk
Altabel Group – Professional Software Development


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